ISLAMIC FINANCE PARADIGM AND ITS IMPACT ON THE BANKING SYSTEM

Abstract

The main aim of this research paper is to provide a literature survey on the islamic finance paradigm and its impact on the banking system. The financial infrastructure differs in the case of Islamic banking compared to conventional banking. The Islamic jurisprudence known as Shariah law represents the foundation on which the Islamic banking system is based. Islamic banking emerged in the mid-1970s and represents an alternative to conventional banking. Moreover, one of the most important aspects is that Islamic banking system has implemented a new banking style based on “interest free” approach.

Keywords

• islamic finance. islamic banking system
• sustainability
• shariah compliance
• islamic law
• financial technology
• conventional banking